Companies have to pay $8000 to $10,000 per H-1B visa.
By Sreekanth A Nair
Recent US visa fee hike is expected to create a burden of $400 million on Indian IT companies, which is likely to affect their margins.
As per the provisions of the Consolidated Appropriations Act 2016 passed recently, Indian IT companies will have to pay additional fees of $4000, which makes it a costly affair for the companies. President Barrack Obama signed the Act on Friday.
The hike will cause Indian IT companies to pay $8,000 to $10,000 per H-1B visa from next year onwards.
According to the Act, companies having more than 50 employees and more than 50% of employees that are on H-1B or L1 Visa status will have to pay an additional fee of $4000 per H-1B visa application.
In the case of L1 visa, they have to pay $4500 and additional Premium Processing Fee of $1225.
Interestingly, the original H-1B visa application fee is only $325. Along with this, a Prevention and Detection Fee of $500 and an Employer Sponsorship fee of $1500 has to be paid. Companies having more than 25 employees only need to pay $1,500 per application. For companies having less than 25 employees, the fee is only $750.
Apart from all these expenses, companies usually pay $1000 to $2000 as attorney fee for filing the visa application.
“The pre-September assessment was that the impact was of the order of a $100 million. This could potentially quadruple because it is doubling of the quantum and expansion of the scope,” R Chandrashekhar, president of the National Association of Software and Service Companies, told The Economic Times.
Indian IT professionals who work in the US on H-1B visa and L1 visa pay towards social security.
But, the social security benefit can be claimed only if they pay for at least 10 years, which is not possible as under H-1B visa Indian professionals cannot stay in the US for more than six years.
Earlier, Infosys founder N R Narayana Murthy had said that Indian companies need not bother about the fee hike.
“I don’t think it is an issue at all, $2000 or $4000 that doesn’t matter. The important thing is that you have to provide excellent value to customers,” he said.
“These are issues that need to be discussed and I have no doubt at all that value of Indian IT services industry is so high to the US corporations that some of these issues will not come in the way of the growth of the Indian IT industry,” he added.